The U.S. Department of Education on Friday released a long-awaited response to an inspector general audit, which found that one the country’s largest online universities had run afoul of federal standards.

The department’s Office of Inspector General found in 2017 that Western Governors University, which enrolls more than 83,000 students, failed to meet federal requirements for the interaction between faculty members and students. The audit said the WGU should pay back $713 million in federal student aid.

The Trump administration wasn’t expected to carry out the IG’s recommendations. The Education Department has been less interested in cracking down on colleges under Betsy DeVos, the U.S. Secretary of Education. And Western Governors has received bipartisan support from Washington policymakers, including praise from the Obama administration for its low-priced, competency-based model.

But Inspector General Kathleen Tighe, who retired from the department last year, found that most WGU courses should actually be classified as correspondence courses, citing a 1992 law that defines distance education programs’ eligibility for federal aid. Those courses don’t meet requirements requiring regular and substantive interaction between faculty and students, according to the audit. And an institution isn’t eligible for federal funds if more than half of its courses are offered via correspondence.

However, in a letter sent to Western Governors on Friday, the department’s Office of Federal Student Aid said that because of “the ambiguity of the law and regulations and the lack of clear guidance available at the time of the audit period” as well as information provided by WGU and its regional accreditor, the department would not seek the return of Title IV student aid funds. (The university will be required to return about $2,600 thanks to one identified instance of deficiencies in returning Title IV funds when a student withdrew.)

Some experts have complained that the “regular and substantive” standard is an outdated way to assess online education programs. The rules may be in flux. In negotiated rule-making sessions starting next week, the Education Department will ask appointed panelists to consider modifying regulations involving faculty interaction. A proposal from the department would allow accreditors to define who qualifies as an instructor for the purposes of college-level courses.

The IG audit also included findings critical of WGU’s adherence to the credit hour standard. But, as with the regular and substantive requirement, the department disagreed with those findings. FSA noted in the letter to WGU that the Education Department is undertaking negotiated rulemaking to craft new policies involving both rules.

“The Department is hopeful that further clarification will be part of future regulations that will help spur the growth of high-quality innovative programs,” the agency said in a press release Friday.

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